Retirement Planning – Highwood
For the people in "Generation X" - described as individuals born between the mid-1960s and also the early 1980s - retirement planning seems like something your parents or other "old people" would do. But you know what? With a lot of "baby boomers" either already in the middle of retirement or looking at it in the near future, "Generation X" is definitely the next generation of people to reach retirement. Sure, it's still a ways off, but people in their 30s and 40s will need to start focusing their investment planning on retirement and making certain they have the kind of retirement they are working so hard to enjoy. Below are great tips on preparing for retirement:
Retirement life in the foreseeable future will be different than the retirement right now. It will be better in some ways, and worse in some ways. But, the retirement planning for today's labor force needs to be far different than it was in earlier times.
On the bright side, individuals are living longer than ever. As of not too long ago, the average life span of an American was 77.9 years, exactly 2.5 years greater than the average life span in 1990 and more than 4 years more than the average life span in 1980. Therefore investment planning for retirement has to account for an extended period of time right now than a generation or two ago.
Social Security and Retiring - Highwood
On the downside, Social Security is going to be a far less dependable income source compared to now. And the odds are slim-and getting slimmer every year-that retirees 20 and 30 years from right now will be able to rely on a work pension and enjoy lifetime benefits from their previous workplace. More and more, retired people will need to rely on their financial savings to pay for the costs of living and health insurance.
With folks living longer and needing more money to do so, retirement planning is a vital activity even for those who are halfway to the regular retirement age of sixty-five. It may be a daunting task to plan for a couple of decades into the future, especially with bills, housing costs and mortgages to pay today, but procrastinating will not make it any less difficult.
Putting even just a small amount of cash into a savings account which serves as a retirement savings plan can pay off later on. The interest you get on money in a savings account will allow your preliminary investments to grow to something sustainable. A savings account will provide a place where you can acquire capital earning a small interest rate until there's enough to invest in a reliable security which will yield you more like a municipal bond.
Another solid strategy which could certainly and progressively build a nest egg is to put money into long-term bonds. On maturation of the bond, you'll get back your initial investment and also all the interest which collected over the lifetime of the bond. This is a significant amount of money for a 20- or 30-year bond-money which could provide a good foundation for retirement. And a municipal or government bond is really as safe an investment as you can ever make.
401K and IRA - Highwood
However, the best approach when it comes to retirement planning would be to put money in a 401K plan at work or in an IRA opened with an investment house. For those for whom a 401K isn't a retirement planning choice, an IRA is the next best thing. Money put in this account is tax deferred and may be tax-deductible, depending on how much is invested annually.
For more info, please don't hesitate to contact GC Financial Advisors Ltd. at any time and we'll be glad to help you! We provide 401K and IRA rollover and review services for individuals in the Highwood area.
